G.R. No. 211422 , October 16, 2019
Ciriaco Oberes, Cesario Oberes, and Gaudencio Oberes, Petitioners, v. Adriano Oberes, Respondent.

FACTS

Petitioners Ciriaco, Cesario, and Gaudencio Oberes, together with respondent Adriano Oberes and Domingo Oberes, are the heirs of the late spouses Francisco Oberes and Catalina Larino. Among the inherited properties was Lot No. 5306, covered by TCT No. 3794 in Francisco’s name. The petitioners filed a Complaint for Annulment of Deed of Sale, Recovery of Possession, and Judicial Partition against the respondent, seeking to annul a Deed of Absolute Sale dated February 21, 1973, wherein petitioner Gaudencio purportedly sold his share of Lot No. 5306 to the respondent. Gaudencio, who is illiterate, denied executing the sale and demonstrated his inability to write in the manner his signature appeared on the deed. The respondent claimed the sale was valid and that he took possession and paid taxes on the lot. The trial court declared the Deed of Sale null and void, finding Gaudencio’s consent vitiated as he merely copied writing without understanding the document’s import, and ordered the partition of the lot between Gaudencio and the respondent’s heirs. The Court of Appeals reversed, dismissing the complaint on the ground of prescription. It held the contract was voidable due to fraud, and the action for annulment, filed in 2003, had prescribed because the fraud was discovered in 1994 when the respondent refused to sign a waiver of rights over the lot, making the filing beyond the four-year prescriptive period.

ISSUE

1. Whether the Court of Appeals gravely abused its discretion in dismissing the Complaint on the ground of prescription.
2. Whether the Court of Appeals gravely abused its discretion in declaring the questioned Deed of Sale merely voidable or annullable and not null and void.

RULING

The Supreme Court granted the petition, reversed the Court of Appeals, and reinstated the trial court’s decision with modification.
1. On the first issue, the Supreme Court held that the action had not prescribed. The Court of Appeals erred in computing the prescriptive period from May 17, 1994 (the date of the Affidavit of Waiver). The complaint, filed on August 13, 2003, was within four years from the actual discovery of the fraud, which occurred only on May 23, 2002, when the petitioners obtained a certified true copy of the Deed of Sale from the Notarial Archives and first saw its contents. Prescription runs from the discovery of the fraud, which requires knowledge of the facts constituting the fraud. The respondent’s mere claim of ownership in 1994 was insufficient to constitute such discovery.
2. On the second issue, the Supreme Court affirmed the trial court’s finding that the Deed of Sale was void, not merely voidable. Under Article 1332 of the Civil Code, when a party is unable to read and fraud is alleged, the person enforcing the contract must show the terms were fully explained. The respondent failed to prove that the terms of the English-language deed were explained to the illiterate Gaudencio in the Visayan dialect. The consent of Gaudencio was absolutely lacking, rendering the contract void ab initio. A void contract is not susceptible to ratification and does not prescribe. The Court modified the trial court’s disposition by ordering the partition of the entire Lot No. 5306 among all five heirs, as the void sale did not affect the property’s status as an undivided inheritance.